Is the Sky the Limit for Menteen Studios?*

This case exposes students to an intriguing industry: film production and distribution. The focus on relevant costing allows students to make recommendations about keeping, dropping, or expanding a distribution channel and about venturing into a new technology for film distribution. The analysis requires critical thinking. Because students are provided with relatively sparse financial information, they are less likely to be fixated on data and more likely to think critically about how to structure analyses to address strategic and operational issues being weighed by the studio. In addition, the case requires students to communicate their recommendations and the underlying assumptions effectively. This case is suitable for use in undergraduate and graduate managerial and cost accounting courses, introductory MBA courses in managerial accounting or strategic thinking, or undergraduate or graduate courses that are specific to the entertainment industry.